Humana moves to 4Q loss, hurt by expense
LOUISVILLE, Ky. (AP) — Humana, weighed down expenses from some long-term care insurance policies, moved to a fourth-quarter loss.
The health insurer, however, stuck by its previous 2014 earnings forecast Wednesday thanks in part to strong growth in Medicare membership. It also said that it had received 202,000 applications for its 2014 health care exchange, the program often referred to as "Obamacare."
For the three months ended Dec. 31, Humana Inc. lost $30 million, or 19 cents per share. That compares with a profit of $192 million, or $1.19 per share, a year ago.
The current quarter included an expense of 99 cents per share related to reserve strengthening in the company's closed block of long-term care insurance policies.
Stripping out the expense, earnings were 80 cents per share.
Analysts surveyed by FactSet predicted earnings of 92 cents per share.
Revenue rose 7 percent to $10.19 billion from $9.56 billion. Wall Street expected $10.2 billion in revenue.
Total premiums and services revenue increased 7 percent, mostly due to higher revenue in the retail and employer group segment from increased average individual and group Medicare membership. This was somewhat offset by the federal government's across-the-board budget cuts, known as sequestration.
Full-year net income climbed 1 percent to $1.23 billion, or $7.73 per share, from $1.22 billion, or $7.47 per share, in the prior year.
Annual revenue increased 6 percent to $41.31 billion from $39.13 billion.
Humana still anticipates 2014 earnings in a range of $7.25 to $7.75 per share.
Analysts foresee full-year earnings of $7.86 per share.
Company shares recently hit an all-time high and rose yesterday to close at $97.47.